The issues related to royal mail

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The Royal Mail (RM) is the national postal service for the United Kingodm, it was founded in 1666, and is a public limited company owned by the British government, in affect a Quango. 'The RM is responsible for universal mail collection and delivery in the UK. Letters are deposited in a pillar or wall box, taken to a post office, or collected in bulk from businesses. Deliveries are made at least once every day except Sundays and Bank Holidays at uniform charges for all destinations within the UK. It was not until 2006 that the RM lost its 350 year monopoly' (Wikipedia 2010). A year later Industrial action took place over pay, conditions and pensions. This action was repeated more recently in 2009. In this essay I will touch on the main reasons for this industrial action by postal workers and discuss whether or not it will help RM's problems, looking deeper into the organisations structure and culture.

For years as the RM operated within a monopoly it was a good source of income for the Government of the day, due to this over the decades all profits were creamed off and reinvestment never took place to help modernise the RM. While globalisation meant the world around the UK was forever evolving, global postal services were emerging with more hi-tech and profitable services, benefiting from larger economies of scale. These two factors combined meant when the postal market became derestricted in 2006 RM had a lot of catching up to do with and no money to do it with; leading to a wave of cost cutting by RM as they tried to become competitive, becoming more automated and cutting jobs.

If you look back through RM's history not much has changed about how the organisation is structured, how they operate and their culture as an iconic British service. They have their own post boxes, their own trademark colour and brand, these have remained constant for decades…that is up until recently. As soon as RM came into contact with the full effect of globalisation in the form of multinational cross continental efficient postal services, culture and structure took a back seat. Run now by managers looking for bonuses and trying to increase competitiveness, employee relations became strained as disillusion and conflicts of interest became apparent between workers and management.

Management practices changed as new goals and objectives were formed, 'this put pressure on traditional management styles. Organisational structures and cultures are becoming increasingly complex, exacerbating challenges of co-ordination. Boundaries between professional specialisations are becoming blurred, complicating decision processes'. (Suddaby, 2008:2).

Organisational culture provides meanings for routine organisational events, thereby reducing the amount of cognitive processing and energy members need to expend throughout the day. An organisations culture can be something it 'has' or something it 'is'. Management can use an organisations culture to guide workers into making rational decisions. Smircich (1983:343) was quoted that 'a culture is something an organisation has'. In essence Smircich believed that if an organisation had a positive culture that was in line with an organisation's objectives, employee's choices regarding an organisation's processes would become rational. It would create an identity that all employees belong to and work for rather than against, allowing managers to steer employees in a chosen direction. RM 'has' an engineered culture, a theory from Jackson and Carter (2000:27). Managers at the top of the mainstream structure impose values that 'rule out particular courses of action or narrow the range of options for a decision' (Knights and Willmott, 2007:348). The broad alternative or competing perspective on organisational culture is that culture is something that an organisation 'is'. Meek (1988:459) said 'most anthropologists would find the idea that leaders create culture preposterous: leaders (according to anthropology) do not create culture, it emerges from the collective social interaction of groups and communities.' RM believe a 'has'type of culture will inevitably improve their bottom line.

However by controlling workers actions and behaviour by enforcing a culture, RM has left workers without a way of expressing any dissatisfaction without taking group action, they feel they have to 'put up and shut up'. A lack of choices for workers is what was intended by RM to increase productivity and decrease the amount of decisions made by workers; however this has backfired as workers become so dissatisfied it leads to ultimatums between RM and the Communication Workers Union (CWU) and therefore strike action. Striking is a last resort however because of the opportunity cost of lost pay and a detrimental effect on relationships with both employers and customers. However workers have needs, both financial and psychological that has to be fulfilled to wish to work. Therefore if workers are dissatisfied industrial action and strikes will take place. Peters and Waterman are firm believes in 'is' cultures and summed up their views on the 'has' perspective by stating 'All that stuff you have been dismissing for so long as the intractable, irrational, intuitive, informal organisation can be managed. Clearly, it has as much or more to do with the way things work (or don't) around your companies as the formal structures and strategies do'. (Peters and Waterman, 1982:11) RM has put too much emphasis on controlling their culture; as opposed to listening to their workforce and realising it does not work.

On the other hand as Meek stated earlier, it may not be wholly RM's managers fault, an organisations culture is also decided by the employees. 'Culture is shared between organizational members; it is seen to provide a "natural" force for social integration' (Meek, 1998, 455). If therefore RM's workers share some of the responsibility for RM's culture today, should they be taking strike action and would this not make it worse? Yet this negative culture felt by RM's workers is exactly why they are taking strike action they are not happy with the 'modernisation' culture, thrust upon them by management. If they are indeed partially responsible and now that the situation has gone out of their control and not to their liking so going on strike, then they are making the situation worse. Striking for the sake of regaining control would be bad for RM as a whole, both employers and employees alike. It makes them more unproductive amplifying the situation. In 1973 Pettigrew stated that he thought politics and bureaucracy was as much a part of an organisation as it was society and government. In which case problems within an organisation are quite possibly inevitable, however by forcing changes in culture upon workers and trapping them RM management have made it worse.

From a workers prospective if they see the organisation they work for publishing profits that have doubled over a year, they are going to feel they need compensating. Workers feel RM's decisions and culture changes have cost them job security, flexible hours, pay and quality of life. Therefore they would strike to fight for a better deal. However this could just be workers being unreasonable and greedy. If we look at it from RM's point of view, they have produced increased profits, does this not therefore mean that the organisation is functioning correctly and efficiently and that the imposed culture by management has worked. Therefore should RM change at all, if it is working and they are becoming competitive, in the long run the workers will realise their jobs are safer with a more productive organisation. Meaning the strikes are not solving the companies problems but making them worse.

Organisational structure is defined as 'the ways in which it divides its labour into distinct tasks and then achieves coordination between them' (Mintzberg, 1979:2). Because RM has been set in its ways for so long not having to change its structure it has become redundant. It's difficult adjusting to changing times and a faster pace of business. Adam Crozier, Chief Executive of RM is reported as saying in an article by the Guardian Online, "Change is difficult for everyone but Royal Mail has no alternative but to change and modernise if it is to compete in today's highly competitive communications market and keep on delivering the postal service on which so many depend," (Thursday 10 December 2009). This shows just how much the RM must change to compete with competitors if the chef executive is publically acknowledging it.

'Economists have long focused attention on strikes as classic examples of breakdown in collective bargaining. A strike can be viewed as an investment - giving up of current resources in the hope of gaining larger returns in the future' (Davidson et al. 1988:387). By striking they hope RM will meet their demands and by doing so they will work more productively and therefore they argue RM profits and competitiveness should be maintained. This leads into the case of globalisation, while structure and culture of RM are important; surviving in a now free market is the aim of the game. Firms such as FedEx and DHL have been able to grow unhindered and with investment for years, allowing them to benefit from greater economies of scale and more efficient services. Strikes and poor service in 2007 led to RM loosing its second largest contract with Amazon, this shows how strikes can cause RM's problems to get worse. Amazon would now have the opportunity to go to a competitor to deliver its parcels, competing directly with Parcel Force worldwide, RM's parcel delivery service. As 'competition between firms is increasingly vigorous the balance is disturbed between commercial and ethical / professional values' (Hitt et al, 2006: 43). When RM realised it had to become more competitive, it cut costs to be able to offer lower prices. This cost cutting led to a restructuring and investment in machinery such as sorting machines that caused the redundancy of nearly 30,000 jobs. This may be considered unethical however it does increase RM's competitiveness and therefore secures the jobs of all the rest of the workers.

RM situation is out of its control in many respects, mainly due to the governments mishandling of the organisation when it was state owned. Every organisation during a recession is looking to cost cut RM is no different, but they do so to survive to enable others to keep their jobs and once business picks up they can rehire people. RM would argue that pay rises are not possible as it would mean more redundancies, however it is interesting that RM's chief executive Adam Crozier is on the highest wage of any government employed individual outside the banking sector, e.g. Northern Rock and RBS. Workers can be perceived as part of the problem as they ask for higher wages and better conditions in a time when RM has to concentrate on spending less money and being more efficient. The timing is the worst possible. By entering into the argument now and RM expectedly saying no to most of the demands, it forced the CWU to take industrial action, as they were left with no alternative. At the time on negotiations the media was very divided but given the environmental factors of the economy once RM put an offer on the table, support shifted towards the RM not the CWU, is was written 'that the union should accept the "perfectly fair and reasonable" offer which was on the table and return to work. Warning the row will cause "irreparable damage" to the Royal Mail if it goes on.' (London Evening Standard, 11th October 2007).

CWU industrial action will cause higher costs for RM and so therefore more cost cutting measures will have to be taken to recoup the losses; starting a vicious cycle that does not benefit either the workers or RM. If the workforce took a more positive stance and worked harder, being more productive, increasing performance then the RM will have more money from increased revenue to reinvest in restructuring and expansion, allowing more jobs, better pay and working conditions.